The Flemish Environmental Holding (Vlaamse Milieuholding, VMH) was originally established on 18 January 1990 as a subsidiary of the Regional Investment Company for Flanders (GIMV). Since 1994, it has worked autonomously on a variety of assignments that were defined in a management agreement by its shareholder, the Flemish Region. By 2000, the VMH portfolio comprised five strategic participations and twenty-five participations in companies active in the environment and recycling sector. In 2001, the Flemish government decided to restructure VMH by downsizing its venture capital operations over the subsequent three years, and selling three of its five strategic participations during the course of the years that followed.
In November 2017, the Flemish government redeployed VMH as an instrument for co-supporting their policy on the “circular economy” transition priority.
In September 2015, the Flemish government issued its “Vision 2050” bill, which proposed a long-term strategy for Flanders (Vision 2050 – A long-term strategy for Flanders 23 September 2015). A vision for prosperity was subsequently developed within this, based on a broad analysis of global trends and the assets at Flanders’ disposal. It also factored in a number of anticipated ecological, economic and social developments. In order to realise this future vision, Flanders must now focus on seven transition priorities and, in particular, the further advancement of the circular economy and recycling, material reuse and bio-chemistry.
The Flemish government harnesses various mechanisms to encourage this transition at both an ecological and economic level, such as allocating budget resources to education and research institutions, and awarding grants to companies (e.g. for research & development and direct support) and private individuals (e.g. for insulation and energy supply). A small portion of the available resources is utilised for venture capital for developing new products and operations, or for enhancing the production apparatus of existing companies.
This latter practice has a number of advantages over grants, for both entrepreneurs and society alike. Entrepreneurs can use this capital injection to attract other forms of financing, enabling them to realise their project. And, if successful, the government achieves part of its strategy, recoups its resources and can subsequently encourage new developments.